Sampling/Extrapolation
Subscribe to Sampling/Extrapolation's Posts

AseraCare Trial Set To Move To Phase Two

The first round is over in U.S. ex rel. Paradies v. AseraCare, Inc., the False Claims Act (FCA) case pending in the U.S. District Court for the Northern District of Alabama that, as we previously reported, was the first in which a court bifurcated an FCA trial between the elements of falsity and scienter. The jury considered the element of falsity as to 121 hospice claims, and on October 15, 2015, concluded that 104 of those claims were not eligible for reimbursement by Medicare under applicable regulations for end-of-life care. The case will now continue to the second phase, concerning scienter, in which the jury will be asked to determine whether AseraCare knowingly submitted false claims. The now-concluded falsity phase was notable because, as we previously discussed, the court denied the defendant's motion for summary judgment on the element of falsity where the government solely relied upon a sampling of claims reviewed by an expert. According to the...

Continue Reading

Fourth Circuit to Rule on Use of Statistical Sampling to Prove FCA Liability

The U.S. Court of Appeals for the Fourth Circuit has agreed to hear an interlocutory appeal on the use of statistical sampling as a means of proving liability under the False Claims Act (FCA). While statistical methods of proof have been used with respect to damages, relatively few courts have considered whether such methods are ever appropriate to establish liability under the FCA. Thus, the court’s ruling has the potential to shape practice in this area moving forward. The case, United States ex rel. Michaels v. Agape, concerns allegations that a network of 24 nursing homes throughout South Carolina submitted fraudulent claims to Medicare, Medicaid and Tricare for care that was not medically necessary. Due to the large volume of potentially fraudulent claims—over 50,000 claims were submitted during the relevant time period—relators sought to use statistical sampling to prove that defendants had submitted false claims. Specifically, the relators sought to...

Continue Reading

Court Refuses To Reconsider Bifurcation Order

We previously posted on the U.S. Department of Justice’s motion for reconsideration of the United States District Court for the Northern District of Alabama’s order bifurcating the element of falsity from scienter (and the other False Claims Act (FCA) elements) at trial in U.S. ex rel. Paradies v. Aseracare, Inc. Last Thursday, the court denied the motion for reconsideration. The court was unpersuaded by DOJ’s contention that bifurcation had never been done before in an FCA case. “Just because a trial technique has never been done does not preclude the court from using its discretion to do so.”  The court also noted—perhaps turning DOJ’s “never been done before" argument against it—that “[t]he parties have not directed the court to any other False Claims Act trial involving a [M]edicare hospice benefit.” With respect to DOJ’s arguments about juror confusion and duplicative evidence in the different phases of a bifurcated trial, the court rejected them, and...

Continue Reading

Bifurcation Squarely Within Court’s Discretion, Notwithstanding DOJ’s Motion for Reconsideration

On June 10, 2015, the Department of Justice moved for reconsideration of the U.S. District Court for the Northern District of Alabama’s May 20 decision in U.S. ex rel. Paradies v. AseraCare, Inc., a False Claims Act (FCA) case in which the court ordered bifurcation of the element of falsity from the element of scienter at trial, with the issue of falsity to be tried first.  Despite the government’s arguments, the bifurcation order was both within the court’s discretion and well-reasoned. A primary feature of the government’s motion for reconsideration is its contention that bifurcation of this type has never before been done in an FCA case.  However, bifurcation lies squarely within a district court’s discretion: the applicable rule (F.R.C.P. 42) expressly provides for bifurcation of “one or more separate issues,” and there is no exception to this rule under the FCA. The government’s position nonetheless suggests that there is something that categorically...

Continue Reading

Use of Statistical Sampling to Establish Damages in FCA Cases Still Controversial

As we previously posted, on April 28, 2015, the United States District Court for the Middle District of Florida in U.S. ex rel. Ruckh v. Genoa Healthcare LLC et al, held that expert testimony based on statistical sampling was appropriate in False Claims Act (FCA) cases and could not be excluded solely due to the concern that sampling, by its nature, subverts individualized proof. The court did, however, preserve the importance of Daubert motions to assail a purported sample, noting that defects in methodology or other evidentiary defects could still result in exclusion of an expert’s sampling analysis. Given the difficulties inherent in identifying a reliable sample in FCA cases involving issues of individualized proof, effective Daubert challenges to a relator’s or the government’s sampling expert are critical when litigating in courts that are inclined to permit sampling, whether offered to prove liability or damages. In Ruckh, the relator alleged that the...

Continue Reading

BLOG EDITORS

STAY CONNECTED

TOPICS

ARCHIVES